Body Shop Accounts Receivable

Start with a reconciled RO balance

Build the review from issued invoices and the current transaction record. Capture the RO and invoice number, invoice date, due date or agreed terms, billed amount, applied payments, applied credits, approved adjustments, and remaining balance. Keep the date and reference for each transaction so the amount can be traced.

Review refunds and payment reversals explicitly. A refund returns money; a credit changes what is owed. Depending on the underlying transaction, a refund may require a matching adjustment or may reopen an amount due. Record both events correctly instead of entering a refund as another payment. Resolve differences with the person responsible for the books.

Allocate each amount only once

A single RO may have both customer and insurer portions. Record those allocations against the same total invoice and reconcile them after every change. They should add up to the amount billed, subject to documented credits and adjustments. Do not put the entire invoice in both payer columns.

Use the claim, authorization, invoice, and payment records to establish the current allocation. An insurer short payment does not automatically make the difference customer responsibility. If responsibility is unresolved, flag the amount and assign a clarification task. The worksheet tracks the documented allocation; it does not determine who legally owes a disputed charge.

Example: split and partial payments

Illustrative example: a $6,000 invoice is allocated as $1,000 customer responsibility and $5,000 insurer responsibility. A $500 customer deposit and $3,500 insurer payment have been applied. The remaining customer balance is $500 and the remaining insurer balance is $1,500. Total open AR is $2,000.

If the shop then approves and applies a $200 credit to the insurer portion, that portion falls to $1,300 and total open AR falls to $1,800. The credit is not a $200 cash receipt. Keep the credit reference and approval. If a payment cannot yet be matched to an RO, investigate it as unapplied cash rather than assigning it by guesswork.

Age balances with a stated basis

Choose an as-of date and state whether aging uses invoice date or days past the agreed due date. For a due-date view, common working groups are current, 1–30, 31–60, 61–90, and over 90 days past due. If a due date is unknown, flag it for review instead of inventing one. These are review categories, not legal collection deadlines.

Intuit's aging-report guidance distinguishes the summary of outstanding balances from the transaction-level detail. Use the summary to locate a problem, then inspect the invoice, payment, and communication records before making contact.

Run a short weekly AR review

Reconcile newly received payments first. Then review overdue follow-ups, older balances, larger exposures, missing payment documents, and open disputes. Assign one owner and a specific next step to each exception. “Verify the remittance for payment reference 4832” is more useful than “call insurer.”

Record the contact date, person reached, information requested, promised next step, and follow-up date. Keep customer and insurer conversations distinct so staff send the right statement to the right party. If the contact disputes an amount, preserve the reason and supporting documents. A dispute is a status to resolve, not permission to delete the receivable.

Keep promises separate from cash

An approved supplement, an invoice, a payment promise, and a cleared deposit are different events. Expected payment dates can support planning, but label them as expectations. Do not mark an RO paid because someone says a check was issued. Record the actual payment event and reconcile settlement or deposit information through your normal accounting process.

Before sending a reminder, check that credits and payments were applied to the correct invoice. Intuit's credit-memo guidance explains that an unapplied invoice and credit can both remain open. That is a reconciliation task, even when the customer's net balance is zero.

Use the worksheet to finish actions

Start the downloadable worksheet with active open invoices, reconciled payer allocations, and the same as-of date. Keep source documents in the RO or accounting file and use references in the worksheet. At the next review, confirm the previous actions were completed before adding new reminders.

Reconcile the worksheet total with the accounting AR report using matching dates and settings. Have authorized staff document credits, write-offs, and other adjustments. AutoHound's payment ledger keeps customer and insurer payments, deposits, refunds, and write-offs with the repair. The operational follow-up list should agree with those records and the accounting handoff.

Shop checklist

• Match the invoice and each payment or adjustment reference.
• Make customer and insurer allocations reconcile to one total.
• Separate disputed and unapplied amounts for investigation.
• Use one as-of date and a clearly stated aging basis.
• Assign an owner, next action, and follow-up date.
• Reconcile the worksheet with the accounting AR report.

All worked examples are illustrative, not customer results or industry benchmarks. This guide covers shop workflow and recordkeeping, not legal, tax, or accounting advice. Confirm requirements with your qualified advisers.